Update: Carnival to Remove Fuel Surcharges (Kind Of)

October 13, 2008

(10:30 a.m. EST) -- Following Carnival Corporation's announcement to drop fuel surcharges, the remaining U.K. brands have now followed suit. Carnival U.K. -- which is responsible for Cunard Line, Princess Cruises, P&O Cruises and Ocean Village -- has announced that from 31 October 2008, fuel supplements will be eliminated for all new bookings on 2010 departures. Moreover, the surcharges might be refunded to passengers booked on 2008/09 departures.

Again, as with last week's announcement, the fuel supplement will be refunded in the form of onboard credit -- and the refund is alas, dependent on the price of oil.

There are few subjects sparking as much discussion on our message boards as cruise line fuel surcharges. But with the price per barrel dropping, numerous Cruise Critic members have been wondering aloud (or at least on the forums) whether it's time for the cruise lines to start eliminating -- or reducing -- the extra charges. Today, Carnival Corp. became the first to announce that they would do just that.

But before you get too excited, know this: The announcement comes with a major asterisk.

Additionally, the company has established specific guidelines under which the current fuel supplement could be reimbursed -- in the form of onboard credit -- to passengers sailing on 2008 and 2009 voyages.

This could mean savings for at least those looking to book a cruise in 2010 on or after October 31 -- and possibly free drinks or logo wear for those who've already booked -- right? Well, here's where things get tricky:

First, and this is the essential point: According to Carnival Corp.'s official statement, a "price increase on all 2010 sailings" will go into place on October 31, 2008 ... the same day that surcharges are lifted on new bookings for those 2010 sailings.

Spokesperson Tim Gallagher tells Cruise Critic that this increase will vary according to the line -- but he could not provide specific information on how much prices would be raised. In other words, he could not say, for example, if fares would increase $63 per person (or more) on a cruise that no longer includes a $63 fuel surcharge.

Second, if you book a 2010 cruise prior to October 31, you'll still be paying the surcharges on your cruise ($9 per person, per day for the first two pax in a cabin, and $4 per person, per day for third, fourth and fifth).

Third, Carnival cautioned that surcharges could be reinstated at any time, depending of course on the price of oil.

And what about those guidelines under which you could get a refund -- again in the form of onboard credit -- for your 2008 or 2009 cruise? This is where things become particularly convoluted.

Carnival's official statement reads: "For 2008 and 2009 departures, if the price of light sweet crude oil according to the New York Mercantile Exchange Index (NYMEX) is $70 per barrel or less at the 2:30 p.m. close of business as reported by Reuters on each of the 25 consecutive trading days ending five trading days prior to the guest's cruise departure date, the fuel supplement will be refunded in the form of a shipboard credit."

To clarify, this means that oil must trade below $70 per barrel for 25 straight trading days (every business day is not a trading day) until five trading days before your cruise.

Thankfully, Gallagher tells us that this is far easier than it sounds: "The process will be automatic and guests do not need to apply [for the credit] or track the price per barrel. The five days is to allow us the necessary time to get the refunds processed and communicate with the relevant vessels." Gallagher says the choice of using the prices on the "NYMEX as reported by Reuters" was established to create solid rules for determining the refunds.

Still, with oil prices so volatile right now, it's almost impossible to predict whether anyone will actually receive a refund under these guidelines.

Will this initial statement trigger similar announcements from other cruise lines? Stay tuned.